You take great pride in your company’s fleet – those vehicles represent you out on the road, and without them, your business would soon grind to a halt. As a fleet manager, you no doubt selected those vehicles yourself from the wide range available – each one is part of the team, a member of the family. You want to look after them, and help them to achieve all that they can.
Once those vehicles leave your lot and head out into the world, you can be left feeling a little out of touch with them. You don’t know exactly where they are going, or how they are performing. Most importantly, you have no idea what kind of costs they are mounting up on their travels. If this sounds familiar, chances are you are not yet using fleet management analytics. Read on to learn how monitoring fleet data can give you valuable insight into your vehicles’ lives when you’re not there to watch them – and how this could cut your costs.
You Can’t Improve What You Don’t Measure
What if you could easily measure fleet performance and quickly spot problems (or opportunities for improvement)? Chances are you fall within the majority of company owners and managers who miss out on massive savings and enhanced ROI by simply by failing to track and analyze fleet performance data.
You can’t improve your key performance indicators if you can’t observe them, which is why fleet management analytics software is used by competitive businesses. But not all solutions are effective enough to help you alter KPIs and generate high returns. Read on to learn how to optimize key areas of fleet performance using powerful fleet management analytics software.
Discover Important KPIs With Fleet Management Analytics
Managing a fleet is expensive, and the pressure is on to minimize costs and maximize profit. Even small improvements can make the difference between ending the year with a surplus, or going over budget. For example, wasted fuel is a major obstacle to increasing ROI, and 53% of fleet managers say their fuel costs exceed expectations each year. If you could make driving routes more efficient or crack down on unauthorized use of fuel cards, the daily, ongoing savings would amount to significant savings.
By identifying which KPIs have the greatest impact on your bottom line, you can start to make the data work in your favour. We’ve identified five common obstacles to increasing ROI, and how fleet management analytics can help you overcome them.
5 Things To Measure When It Comes To Fleet ROI Optimization
Use fleet management analytics to examine how your fleet performs in these five key areas:
1. Distance Traveled Each Year
Distance covered by fleet vehicles is almost always top of the pile when businesses discuss their fleet management concerns. If drivers are covering more ground than they need to, they are costing you more than they should. Analyzing distance traveled can help identify where your fleet covers unnecessary ground, highlight unauthorized use and flag up inefficient transport routes.
2. Kilometers per Liter (KPL)
According to finance analyst Steve Jastrow, “innovation in analytics continues to provide the best opportunity to help fleets… reduce fuel expense.” Analyzing a fleet’s fuel expenses can highlight areas where fuel is being wasted, and help drivers and managers push costs down.
3. Fleet Acquisition Costs
Pay close attention to data concerning fleet usage. You might discover that you could manage with less vehicles once efficiency is tightened up, or that you could lease extra vehicles at busy times rather than leave permanent purchases sitting idle when quiet. For example, knowing how many jobs each vehicle completes per day against your overall yearly contracts can give a clear idea of how big your fleet should be.
4. Maintenance and Repairs
Do you know how much a vehicle out of action is costing you or how much you can truly afford to spend on it? On top of repair costs, a truck or van that can’t run is costing you greatly in productivity losses. Fleet management analytics can identify exactly what those costs are. Seeing those figures should be all the motivation you need to start speeding up repairs and improving maintenance procedures. The average commercial van runs at around CA$0.37 per kilometre when fuel and maintenance are accounted for – fleet data should advise you how far off that target you are.
Tracking driver behaviour can make your fleet safer. This is one of the main reasons fleet monitoring technology first came on the scene. Whether drivers are harming your company’s reputation, racking up fines and penalties, burning through fuel, or prematurely aging your vehicles, you need to know so you can address the problem quickly. Driver and vehicle data will highlight anomalies in performance that could be building up costs.
Whether you are reducing accidents, cutting repair costs, or looking after drivers, the data gathered by fleet management analytics software will give you a clear picture of your fleet’s performance and enable you to optimize your ROI.
Just Collecting Data Isn’t Enough
Of businesses that currently use fleet management analytics, 27% say “improved budgeting is a major advantage” of their software. Fleet analytics is a proven method for driving down costs and improving efficiency, so what’s happening to the other 73%? Research suggests that while organizations are gathering data with fleet monitoring analytics software, they are not applying the insights they’ve gained.
Collecting fleet performance data is an important first step, but that data is useless to your company if you don’t act on the results. Some companies presume drivers will look at data and change their behavior, but in a study by Shell, nine out of ten drivers “admitted they act on less than 60% of the insights offered” by fleet data due to a lack of resources or training – putting the onus back onto managers to drive action and change.
Fleet management analytics software can both gather data and make it easy to discover specific opportunities for improvement. Clear, actionable insights enable you and your drivers to take action – and see results.
Gain Control Over ROI With Fleet Management Analytics
In the past, many of the factors affecting commercial fleet ROI were out of a business owner’s control. From fuel costs and miles driven to safety management and maintenance needs, once a vehicle hit the road there was little opportunity to control any of its KPIs.Today, use of telematics is growing more prevalent as companies recognize the benefits. In fact, estimates suggest the fleet management market will be worth $22.35 billion by 2020.
Thanks to fleet management analytics, companies can get a detailed account of every aspect of fleet performance—including ROI roadblocks. Tracking devices and managed software make fleet management analytics practical, time-efficient, and cost-effective.
For more information on how Nero Global can help you improve fleet management and optimize your KPIs, contact us today.